Budget to be inflationary says industry

By: | Updated: 16 Mar 2012 03:17 AM


New Delhi: As finance minister Pranab Mukherjee resorted to
mopping up more taxes, a disappointed India Inc on Friday said his budget
is a "missed opportunity" and would have cascading impact on inflation and
consumer demand.




"It is not going to stimulate growth in the economy," FICCI president RV
Kanoria said.




CII president B Muthuraman said he was expecting much more and the
excise-related proposals would push up prices.




However, the steps to control fiscal deficit would augur well for the
economy.




"The budget is a missed opportunity," Siddharth Birla of CK Birla Group
said.




Biocon CMD Kiran Majumdar Shaw expressed fears the budget would be
inflationary.




Harshpati Singhania of JK Group echoed similar views.




"Increase in excise duty will have inflationary implications," he said.




The government, hard-pressed for cash, proposes to levy additional
indirect taxes of Rs 45,940 crore for 2012-13 at a time when the industry
is facing slowdown in demand.




"...deficit is still high which is disappointing. Things are going to
become costlier for final consumer," Godrej Group Chairman Adi Godrej
said.




Assocham president RN Dhoot said that he was expecting that the personal
income tax exemption limit would be raised to 2.5 lakh per annum. "It is
not done which is disappointing."




However, certain initiatives like liberalising the external commercial
borrowing (ECB) rules and boost to investment particularly in
infrastructure sector were hailed by industry leaders.




The BSE benchmark Sensex was almost flat during mid-day after the budget
was unveiled.




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First Published: 16 Mar 2012 03:17 AM
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